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The Active Company produces a product with the following unit information: Selling price Variable cost Fixed manufacturing cost per unit Direct material (metres) required per
The Active Company produces a product with the following unit information: Selling price Variable cost Fixed manufacturing cost per unit Direct material (metres) required per unit Direct labour hours required per unit Machine hours required per unit $60.00 $35.00 $12.00 4.0 0.5 2.5 Required: 1. Calculate the profitability of the product if direct labour hours is the constraint (2 marks) 2. List two ways to relax the constraint identified in part 1. (2 marks) 3. What impact does a constraint have on a company? (1 mark)
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